Consider the following two projects: 1 Cash flows Ce C1 C2 Project A Project B -$220 -$220 90 114 90 114 90 114 90 a. If the opportunity cost of capital is 8%, which of these two projects would you accept A. B. or both? b. Suppose that you can choose only one of these two projects. Which would you choose? The discount rate is still 8%. c. Which one would you choose if the cost of capital is 139? d. What is the payback period of each project? e. Is the project with the shortest payback period also the one with the highest NPV? f. What are the Internal rates of return on the two projects? g. Does the IRR rule in this case give the same answer as NPV? n-1. If the opportunity cost of capital is 8%, what is the profitability Index for each project? h-2. Is the project with the highest profitability index also the one with the highest NPV? h-3. Which measure should you use to choose between the projects? Complete this question by entering your answers in the tabs below. Req A Reg B Reqc Reg D ReqE ReqF Rey G Req H1 Reg H2 Req H3 If the opportunity cost of capital is 8%, which of these two projects would you accept (A, B, or both)? Which projects would you accept? Ren ReqB > Complete this question by entering your answers in the tabs below. Req A Reg B Reqc Reg D Reg E Req Rey G Reg H1 Reg H2 Req H3 Suppose that you can choose only one of these two projects. Which would you choose? The discount rate is still 8%. Which project would you choose? Complete this question by entering your answers in the tabs below. Req A Req Reqc Rey D Reg E Red F Rey G Red H1 Reg H2 Req H3 Which one would you choose if the cost of capital is 13%? Which project would you choose? Complete this question by entering your answers in the tabs below. Req A Reg B Rey C Red D Rey E Red F Reg G Reg H1 ReqH2 Reg H3 What is the payback period of each project? Project A Project B Payback Period Complete this question by entering your answers in the tabs below. Req A Reg B Reg C Red D Reg E Req Rey G Req H1 Reg H2 Reg H3 Is the project with the shortest payback period also the one with the highest NPV? Shortest payback would also mean highest NPV